AES Corporation has closed on its $1.5bn long-term non-recourse construction financing for its 1,200MW Mong Duong II coal-fired power plant located in the Quang Ninh province of Vietnam.

According to the company, 12 commercial banks and two Korean government export credit agencies participated in the transaction.

AES holds a 51% equity ownership interest in the $1.95bn project, while a subsidiary of POSCO Power and a unit of China Investment Corporation hold 30% and 19%, respectively.

Doosan Heavy Industries and Construction Co will serve as the engineering, procurement and construction contractor for the power project, which is expected to begin commercial operations in 2015.

AES has signed a 25-year agreement with the Vietnam National Coal-Mineral Industries Group for the supply of locally sourced coal to the facility.

Electricity generated by the facility will be sold to state-owned power company Vietnam Electricity under a 25-year agreement.